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Planning Processes

Planning is a systematic process in which managers make decisions about future activities and the key goals that the organization will pursue. The necessity of careful environmental scanning has an immediate impact on planning processes. The basic principles of planning will remain the same. This means that successful companies will seek to fulfill a well-established mission. Effective companies require a foundation and sense of purpose. This will not change. What might change will be the mission statement itself. Over time, organizational mission statements are updated. In the past two decades, many organizations have rewritten their mission statements to include a more global perspective. Others have increased the emphasis on being more socially responsible and ethical. Others have made it a point to express the desire to become more environmentally friendly. This in turn impacts the five steps of planning displayed in Table 7.1.

Table 7.1: The Steps of Planning
Scan the Environment	internal and external environments SWOT analysis
Forecast Future Events	sales, economic, technological
Determine Organizational Goals	strategic, tactical, operational
Develop Plans	strategic, tactical, operational
Allocate Resources	budgeting

Following the completion of a SWOT analysis that considers the evolving nature of the external business environment, internal company strengths and weaknesses should constantly be reexamined. Forecasting will remain a key element. Managers need to know what to expect in terms of revenues, future economic conditions, and changes in technology. It would not be surprising if many companies increase the emphasis on quality technological forecasting.

Setting strategic, tactical, and operational goals should remain a constant. Without clear performance targets, the company can quickly drift off track. What might change? The best guess for what might change would be in the area of contingency planning. An uncertain future requires the additional preparation and development of "what if?" plans for unforeseen events. At present, companies create plans for cybernetic threats, economic downturns, shortages of raw materials, and terrorist attacks. In the future, should the predictions made by those concerned with global climate change come true, other plans related to weather may be in order.

The final step of planning, allocating resources through budgeting processes, continues. Contingent budgets may be written to cope with unusual circumstances. At the same time, the budgeting process remains largely unchanged.

Organizing

Organizing is the process of bringing people and resources together to create products and services in an efficient and effective manner. Organizing establishes task and authority relationships that allow people to work together to achieve the organization's goals. Organizing consists of the three primary activities shown in the following tex tbox:

Steps of Organizing

· Create specific, yet flexible job designs

· Departmentalize work flow to be adaptable to new circumstances

· Determine the organizational structure

Job design as an activity takes on new meaning as time passes. The primary challenge will be developing job descriptions that account for new tasks. Many of these will be associated with changes in technology. As a simple example, a visitor to a large hotel chain recently stopped to ask the valet who parked his car for directions to the Interstate. Instead of providing a simple verbal description, the valet opened his mobile phone and displayed a map with directions for the traveler. Nearly every type of job incorporates additional technologies over time.

Departmentalization continues to acclimate to new circumstances. One new trend recently investigated by the Academy of Management is the increasing nature of the boundaryless organization, which consists of individuals working together on projects from various companies and institution,s with less regard to traditional borders. As an example, counterterrorism often involves the cooperation of local police, specially trained governmental forces such as the FBI and CIA, persons in foreign governments, and private citizens.

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In today's work environment, many tasks are completed by persons working across traditional organizational boundaries.

Many problem-solving types of work now include collaborations of people across boundaries. In management, a large international study, known as Project Globe, has been established to understand cultural differences and their impact on leadership. Members of more than 100 universities in separate countries are engaged in the project.

Many organizational structures have changed to more organic, flexible forms. The use of standard operating procedures may lessen, especially as an economy becomes more service based. Greater delegation of authority and autonomy has been granted to numbers of employees, in order to meet company needs.

Staffing

The staffing function will undergo modification as new conditions necessitate. Staffing is the achievement of organizational goals through the effective and efficient deployment of people. The following text box displays the primary human resource activities.

Human Resource Activities

· Job design

· Human resource planning

· Recruiting

· Selection

· Orientation

· Employee training

· Compensation management

· Performance appraisal

· Employee discipline systems

· Workplace safety

· Career development

· Union-management relations

The influences of new business trends on job design have been mentioned. Technology plays the primary role in changing job descriptions and job specifications.

Human resource planning will undoubtedly experience the effects of increasing globalization and diversity. Staffing members are likely to become familiar with the concepts of (a) host country employees, (b) expatriate employees, and (c) third-party national employees. A host country employee is someone who lives in the country where the work will be performed and will oversee activities in that nation. An expatriate employee is someone sent from a home country (where the home office is located) to the host country. A third party national is someone who does not live in either the home or host country. At the management level, ethnocentric management involves the employment of expatriate employees. Geocentric management uses host country employees. Polycentric management applies mostly to global conglomerates that employ third-party nationals.

Recruiting, selection, and orientation processes are likely to account for increasing diversity. Also, many firms now stress ethics training as part of the orientation process. Human resource managers will continue to abide by legal dictates when making selections of new workers.

Employee training programs must consider issues of diversity as well as educational disparity. Problems associated with employees feeling either over- or underqualified arise due to the growing divide between those with higher education and those who fail to finish high school.

The biggest challenge to those involved with compensation management will likely emerge from political forces. The health care reform laws passed in 2010 were designed to be fully enacted over a 4-year span. By 2011, there were efforts to overturn the law. Human resource managers will be expected to investigate the impact of these laws on their specific companies. Benefit programs also continue to evolve. The 2011 Congress voted to make dramatic changes in the Medicare program, although the Senate did not enact the changes. Companies should consider the future of retirement programs as they cope with an aging workforce.

Performance appraisals reflect the job description, job specification, and individual goals and standards. As the nature of a job changes, the methods used to measure performance should be adjusted. Keeping rater bias out of appraisal systems remains an important concern.

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Workplace health and safety extends beyond safety rules and includes efforts in the area of stress management.

Employee discipline systems are updated when new rules are required. The recent overturn of the "don't ask, don't tell" policy in the military serves as an example. Managers now often use social media to make hiring decisions based in part on a review of what a person did at a younger age. What constitutes privacy in this new age presents additional challenges to human resource managers and other supervisors.

Workplace safety involves new issues. As many people are asked to work longer hours, accompanied by technologies such as GPS tracking systems and mobile phones that can locate them at anytime, increases in stress-related problems would not be surprising. Findings by the World Health Organization related to some type of connection between mobile phone use and cancer risk also invites additional scrutiny.

Career development programs are the staple of effective business organizations. The methods used to train managers remain largely the same. What may change will be the types of tasks managers are expected to supervise. Challenges associated with diversity and globalization will also have an impact on career development and manager training systems.

Union-management relations will stay unaltered unless changes in the legal system dictate otherwise. In Europe, a greater degree of cooperation exists between companies and employee unions. Managers from the United States who work with European Union countries will need to understand the differences. The number of unionized employees continues to dwindle in the United States. Time will tell if that trend will continue, or if new types of jobs will become targets of union organizers. If so, some managers may find themselves dealing with unionized employees for the first time.

Leading

As discussed in Chapter 5, Leading in a business context, consists of all activities undertaken to help people achieve the highest level of performance. Leadership means influencing behaviors in organizations. Remember that managing is about coping with complexity. Leadership is about coping with change. Both will be high priorities for supervisors, middle managers, and executive managers of the future. Leading functions in the future will continue to involve the processes shown in the following text box.

Leading Functions and Activities

· Managing power

· Providing leadership

· Motivating employees

· Directing teams and groups

· Communicating effectively

Power dynamics can quickly transform in the modern world. One trend has been that experts have a growing source of power. Experts manage uncertainty or anything that threatens an organization's well-being. Experts are also boundary spanners who deal with external organizations that make demands on a company (the government, suppliers, retail outlets, special interest groups). Because they protect the organization, they have power. As managing uncertainty and boundary-spanning activities continue to increase, the power level of those involved will continue to rise.

Leadership may be provided in various ways. Standard views of people and production-oriented leaders are giving way to new concepts. Many organizations actively seek out transformational leaders; however, others rely on technocrats, or persons well versed in technologies who also exhibit the ability to influence others.

Motivating employees requires adaptation as a new generation of workers enters the business world. While the "greatest generation" worker seemed driven by career success, and the "baby boomer" generation seemed motivated by the intense competition associated with larger numbers of people of the same age, a new generation has emerged. Many current employment experts believe this generation views themselves more as "free agents" who are willing to move between organizations, with a much lower sense of commitment or obligation to any one company. These individuals believe life should be balanced between home and work. As a new group of people come of age, you can expect a different set of values to appear again.

Directing teams and groups is highly likely to be part of your job description. The complex nature of tasks makes them necessary. Many managers will succeed and receive promotions when they exhibit the ability to create team players and manage inter- and intragroup conflicts.

Controlling

Controlling is the process of evaluating performance against established goals and creating methods appropriate to take corrective action to maintain or improve performance in any area of the organization.

The Standard Control Process

1. Establish and review standards set in the planning process.

2. Measure performance at the strategic, tactical, and operational levels.

3. Compare performance outcomes with the standards that were set.

4. Make a decision:

· successful performance should be rewarded;

· unsuccessful performance should be corrected.

The important link between setting standards in the planning process and following up on them in the controlling process remains a vital part of managing. Performance measures will continue to operate on the three main levels. Many conglomerates rely on profit centers and strategic business units to serve as additional layers in the controlling function.

Companies will modify tactical controls to fit with changing technologies. For example, most companies now assess the results of online marketing efforts against one set of standards and the use of traditional media using another. Similar modifications are made with the technologies that affect the production process. Also, outsourcing changes the ways in which quality standards are set and evaluated. A company may find itself held responsible for a defect in a part made in another country.

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Effective managers remember to reward performance.

As a manager, your job is to remember the importance of rewarding successful performance. It will be one of the keys to motivating employees and will play a major role in your credibility as a manager. The type of manager destined to fail has always been the one who promises but does not deliver rewards.

Controlling helps companies stay on the track to success. In the coming years, periods for control will continue to shorten. The term real time has taken on new meaning in the business world. Many events and activities can be observed while they are taking place. Reliance on feedback control can be expected to diminish as the use of concurrent and feedforward control increases.

Connecting the Five Functions

The five functions of management—planning, organizing, staffing, leading, and controlling—have many close linkages. Planning is part of every other management function. Creating and maintaining an organization's design requires planning. One of the first steps in staffing is human resource planning. Leading requires planning. Leaders rely on motivational programs that are planned in advance. Teams and groups use plans to direct activities. Communication systems and all of the new iterations of those systems necessitate careful planning to spot new trends and to implement changes in technologies. Planning is the basis of control through the use of standards.

The organizing function shares similar bonds with other management functions. The first element of organizing, job design, is shared with the staffing function. Job specifications established in the job design aspect of organizing are used to recruit and select employees. Employees who fit are able to effectively work in company-prescribed teams and groups and communicate effectively within the system.

Staffing shares the human element with leading. Staffing involves choosing the right people. Leading includes enticing the highest levels of performance from those people.

Controlling has one element in common with staffing. Both are involved in the performance appraisal process for individual employees. Standards link controlling and planning. Further, controlling begins the process of creating the next set of plans.

In summary, the linkages between the five management functions make them inseparable activities. Successful managers understand the links and carefully follow through on every aspect of the management program.